PayPal Opens Fintech Earnings Amid Investor Anxiety Over Tariff-Driven Consumer Spending Slowdown

PayPal will report its latest quarterly earnings today, launching a critical earnings season for consumer-focused fintech firms as Wall Street grapples with economic uncertainty driven by sweeping new tariffs from President Donald Trump’s administration.

PayPal, along with peers Block and Affirm, is heavily exposed to consumer spending trends, putting all three under scrutiny amid fears that rising import costs and economic volatility could lead to weaker demand. Investors have grown increasingly cautious as tariff-related policy changes raise questions about the strength of consumer activity through the remainder of 2025.

One significant change taking effect May 2 is the elimination of the de minimis trade exemption for low-cost Chinese imports—a move expected to shake up cross-border e-commerce, particularly for platforms like Temu and Shein. Analysts from Wells Fargo warned this could reduce transaction volumes processed by digital wallets and payment platforms, including PayPal, which derives 90% of its revenue from consumer-driven activity.

A smartphone displaying the PayPal logo rests on a laptop keyboard

Markets briefly rebounded last week on optimism that trade negotiations might ease tariff enforcement. However, after Trump enacted tariffs on over 180 countries earlier this month—followed by a temporary 90-day pause for most, excluding China—uncertainty remains high. Tariffs on Chinese imports now top out at 145%, while a 10% baseline rate has been imposed on goods from most other countries.

Fintech stocks have been particularly hard-hit in 2025. PayPal shares are down 23% year-to-date, Block has plunged 32%, and Affirm has fallen 19%, all underperforming the Nasdaq’s 10% decline.

The ongoing tariff and e-commerce headwinds are already affecting corporate strategy. Klarna and StubHub both delayed IPO plans in early April due to market volatility. Barclays analysts highlighted the heavy toll these new tariffs could take on e-commerce volumes and digital payment flows.

Wells Fargo recently lowered its price target on PayPal stock from $80 to $74, citing margin pressure and slowing international growth. The firm projects that PayPal’s Venmo segment could also take a hit if discretionary consumer spending contracts. Analysts expect PayPal to report a modest 1.9% revenue increase year-over-year to $7.85 billion, with earnings of $1.16 per share.

Other fintechs reporting soon include Block, which will announce results Thursday, and Affirm, scheduled for next week. Block faces its own challenges with sluggish Cash App growth and a conservative lending stance at Afterpay. LSEG expects Block to post $6.2 billion in revenue and 87 cents in earnings per share.

Affirm, which relies on consumer purchases of non-essential goods, saw user growth jump 30% in March. Still, rising credit risk and softer consumer demand could suppress its momentum. Forecasts call for $783 million in revenue—a 36% increase—but a small loss of 3 cents per share.

Barclays noted that some recent consumer spending may have been pulled forward ahead of the May tariff deadline, potentially distorting short-term earnings results and delaying a true picture of economic impact.

Executives from PayPal, Block, and Affirm declined to comment ahead of their earnings calls.